For two days in August, Wits Business School (WBS) was a hive of activity and robust debate on the status of Africa’s economic development. Under the theme “Growth and Inequality in Africa”, the African Review of Economics and Finance (Aref) Conference 2018 brought together 90 top scholars and policymakers from around the continent and the rest of the world.
WBS’s academic director Professor Paul Alagidede, who chaired the conference, was excited to bring the AREF conference to South Africa for the first time.
“It was a coup for WBS to host the prestigious Aref conference this year, especially as 2018 marks the 50th anniversary of our school,” says Alagidede. “The conference seeks not only to understand the African continent, but also to change it — which is why we ensure that our thoughts and deliberations are brought to the attention of policymakers and to the wider public.”
Tackling the tough challenges of poverty and inequality means confronting deep-rooted and (often country-specific) complexities, and there are no easy answers. And, contrary to expectation, economic growth has not reduced inequality in Africa.
“The most serious economic problem in Africa today is inequality, but orthodox economists have consistently focused on the continent’s presumed lack of growth. We now know that the celebration of ‘Africa on the rise’, a moment of the resurgence of growth in Africa, was premature. Not only has growth stalled: it neither brought about income nor wealth convergence. In contrast, it worsened spatial inequality, worsened gender inequality, and worsened racial inequality in terms of both income and wealth. Mainstream economics has neither been able to explain nor been able to provide guidance on how to resolve these contradictions,” says Alagidede.
“This year’s Aref conference has faced questions of inequality head on, questions such as: why does growth occur amidst widening income and wealth gaps? What are the consequences of this new economic apartheid in Africa? In what ways can economics be reworked to provide appropriate analytical and policy mechanisms to better understand, transcend and address inequality within the continent, and between the continent and the rest of the world?”
During the conference, 85 papers were presented on themes ranging from the interface between the environment and economic growth, the place of entrepreneurship and innovation in an inclusive process of economic development, asset pricing and returns, financial sector development and liberalisation, monetary policy, education, leadership and natural resource management.
Keynote addresses were given by Professor Augustin Kwasi Fosu of the Institute of Statistical, Social and Economic Research at the University of Ghana and Professor Ingrid Woolard, dean of Economic and Management Sciences and Professor of Economics at Stellenbosch University. Fosu took delegates back to the resurgence of growth in the 1990s and examined the progress made on poverty, while Woolard investigated the dynamics of inequality, growth and domestic resource mobilisation in Africa.
“Growth is happening in Africa, albeit slowly, and varies strongly from county to country. What is disturbing is that the growth that has been celebrated is also the cause of the unequal distribution of wealth and income on the continent,” comments Alagidede. “It has never been more pressing that we interrogate these contradictions and develop new thinking that will ensure that future economic growth results in a fundamental closing of the yawning inequality gap.”